M/s Sri Taraka Jewellers, Nalgonda V. ITO, Ward-1, Nalgonda

ITA 600/HYD/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69755 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 29-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAKIR HUSSAIN SHAIK
• Assessee Lawyers: A V RAGHURAM
• Keywords: Unexplained investment; Opportunity of being heard
• Section: 133A

Judgement Text

1 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 600/HYD/2013 ASSESSMENT YEAR:2008-09 M/S SRI TARAKA JEWELLERS, ASSESSEE NALGONDA. (PAN ABGFS4722E) VS. INCOME-TAX OFFICER, RESPONDENT WARD 1, NALGONDA ASSESSEE BY : SHRI A.V. RAGHURAM RESPONDENT BY : SHRI SHAKIR HUSSAIN SHAIK DATE OF HEARING : 13/08/2013 DATE OF PRONOUNCEMENT : 30/08 /2013 ORDER PER SAKTIJIT DEY, J.M.: THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)-V, HYDERABAD DATED 31/01/2013 FOR T HE ASSESSMENT YEAR 2008-09. 2. BRIEFLY THE FACTS OF THE CASE ARE, THE ASSES SEE FIRM IS ENGAGED IN THE BUSINESS OF TRADING IN GOLD AND SILV ER ORNAMENTS. FOR THE AY 2007-08, THE ASSESSEE FIRM FILED ITS RETURN OF INCOME ON 04.10.2008 ADMITTING A TOTAL INCOME OF RS. 8, 71,974/-. FOR THE SUBJECT ASSESSMENT YEAR, THE ASSESSEE HAD SHOWN A GROSS 2 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS TURNOVER OF RS. 3 3,66,055/- AND ADMITTED INCOME AT 5% OF THIS TURNOVER AT RS. 6,73,210/-. THE ASSESSEE HAD ALSO S HOWN INCOME TOWARDS MAKING CHARGES /REPAIRING CHARGES OF RS. 6, 15,000/-. ON 13.09.2007 A SURVEY OPERATION U/S 133A WAS CARRIED OUT IN THE BUSINESS PREMISES OF THE ASSESSEE-FIRM. IT WAS FOUN D IN THE SURVEY THAT THE ASSESSEE IS NOT MAINTAINING ANY BO OKS OF ACCOUNT FOR THE BUSINESS AND ADMITTING INCOME ON PRESUMPTIV E BASIS. ON THE DATE OF SURVEY, THE PHYSICAL STOCK AVAILABLE WA S INVENTORIZED AT RS. 97,59,430/-. BY TAKING THE OPENING STOCK SHO WN BY THE ASSESSEE AS ON 01/04/2007 AND PURCHASES AND SALES M ADE UP TO THE DATE OF SURVEY, THE ASSESSING OFFICER WORKED OU T EXCESS STOCK OF RS. 45,02,866/-. THE DETAILED WORKING FOR THIS E XCESS STOCK WAS GIVEN IN ANNEXURE-B TO THE ASSESSMENT ORDER. WHILE BRINGING TO TAX THE EXCESS STOCK OF GOLD WORKED OUT AT RS. 45,0 2,866/- , THE ASSESSING OFFICER ADOPTED A PROFIT RATE OF 8% ON TH IS EXCESS STOCK' AND ADDED FURTHER AMOUNT OF ~3,24,708/-, TAKING THE TOTAL ADDITION TO RS. 48,27,574/-. 3. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER I N APPEAL BEFORE THE CIT(A). 4. BEFORE THE CIT(A), THE AR OF THE ASSESSEE SUBMI TTED THAT IN THE ASSESSMENT, WHILE ARRIVING AT THE EXCESS STO CK OF GOLD AT RS. 45 ,02,866/- ON THE DATE OF SURVEY AS PER ANNEXURE-B, THE ASSESSING OFFICER ADOPTED THE OPENING STOCK OF GOLD AT RS. 36,70,000/-. WHEREAS F OR THE PREVIOUS ASSESSMENT YEAR 2007- 08, WHILE ARRIVING AT THE UNACCOUNTED STOCK WHEN COMPAR ED TO THE STOCK STATEMENTS GIVEN TO INDIAN OVERSEAS BANK, THE CLOSING STOCK AS ON 31.03.2007 HAS BEEN ARRIVED AT RS. 36,70,000/-. IT WAS SUBMITTED THAT O N THIS WORKING, THE STOCK STATEMENTS GIVEN TO BANK COULD NOT BE BASED FOR ARR IVING AT THE PHYSICAL STOCKS. 3 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS 5. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESS EE, THE CIT(A) OBSERVED THAT THE GIST OF THE DECISION OF TH E TRIBUNAL AND OTHER DECISIONS ON THE ISSUE OF ADDITIONS MADE ON THE BASIS OF STOCK STATEMENTS FURNISHED TO THE BANK ARE THAT THERE SHOULD BE SOME INDEPENDENT FINDING THAT THE ACTUAL STOCK IS IN EXCESS OF RECORDED STOCKS, WITHOUT WHICH THE ADDITI ONS SOLELY MADE ON THE BASIS OF STOCK STATEMENTS FURNISHED TO BANK CANNOT BE UPHELD. THE CIT(A) NOTED THAT MENTIONED S UPRA, DURING THE COURSE OF SURVEY, THE ASSESSING OFFICER INVENTORISED THE PHYSICAL STOCK AVAILABLE ON THAT DATE. ON 13.09 .2007 GOLD OF 11.38 KGS WAS FOUND IN THE PREMISES OF THE ASSES SEE AND ADOPTING THE RATE OF THE ASSESSEE FOR 22 CTS, THE G OLD WAS VALUED AT RS. 93,31,160/-. LIKEWISE, THE SILVER AR TICLES WEIGHING AT 42.827 KGS WERE VAULEDAT RS. 4,28,270/- . THE CIT(A) OBSERVED THAT THE PHYSICAL STOCKS SO FOUND A ND VALUED AS PER THE RATES OF THE ASSESSEE NEEDED TO BE CROSS -VERIFIED TO ARRIVE AT CORRECT FINANCIAL RESULTS OF THE BUSINESS OF THE ASSESSEE. HOWEVER, THERE WAS NO MATERIAL AVAILABLE TO THE ASSESSING OFFICER TO .CROSS VERIFY THE PHYSICAL STOCKS ON THE DATE OF SURVEY AS THE ASSESSEE, ADMITTEDLY, HAS NOT MAINTAINED ANY BOOKS OF ACCOUNT FOR HIS BUSINESS. WHAT ALL THE ASSESSEE HAD ADMITTED IN THE RETURN FILED FOR THE YEAR IS PR ESUMPTIVE INCOME @ 5% OF HIS TURNOVER. IN THE PROCESS, THE ASSESSEE HA S ADMITTED A TURNOVER OF RS. 33,66,055/- BUT THE VER ACITY OF THIS TURNOVER IS NOT VERIFIABLE FROM ANY STANDARD SOURCE , EXCEPT DEPENDING ON THE SUBMISSIONS OF THE ASSESSEE. THOUG H DURING THE APPEAL PROCEEDINGS, THE ASSESSEE FURNISHED THE SALE BILLS, THE CIT(A) WAS OF THE VIEW THAT MUCH CREDENCE CANNO T GIVEN TO SUCH SALE BILLS WITHOUT ANY BASIC SOURCE TO CROSS-V ERIFY THE SALE FIGURES. THE CIT(A), THEREFORE, CALLED FOR A REMAND REPORT FROM 4 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS THE ASSESSING OFFICER ON THE SUBMISSIONS OF THE ASS ESSEE. THE ASSESSING OFFICER SUBMITTED HIS REMAND REFUTING ASS ESSEES CLAIM. 6. AFTER TAKING INTO ACCOUNT THE REMAND REPORT, TH E CIT(A) HELD THAT IN THE ABSENCE OF BOOKS OF ACCOUNT MAINTA INED BY THE ASSESSEE TO VERIFY THE DAY-TO-DAY TRANSACTIONS, ONE HAS TO ADOPT AN ACCEPTABLE METHOD TO ARRIVE AT THE FINANCI AL RESULTS BASED ON AVAILABLE MATERIAL. AS THE ASSESSEE DID NO T FURNISH ANY BOOKS OF ACCOUNT, THE ASSESSING OFFICER IN THE INSTANT CASE HAS TO RELY ON THE STOCK STATEMENTS FURNISHED BY TH E ASSESSEE TO THE BANK. THE CIT(A) OBSERVED THAT ON ONE HAND, THE ASSESSEE CLAIMS HE HAS NOT MAINTAINED ANY BOOKS OF ACCOUNT AND ON THE OTHER, REJECTS HIS OWN STOCK STATEMENTS FURNISHED TO THE BANK. THE ASSESSEE FURTHER CLAIMS THAT THE S TOCK STATEMENTS. ARE PREPARED ON ESTIMATE BASIS FOR GETT ING OD FACILITY AND THESE STATEMENTS CANNOT BE RELIED UPON TO ARRIVE AT THE PROFITS OF BUSINESS. IF THE SAID CONTENTIONS OF THE ASSESSEE WERE TO BE BELIEVED, THEN THERE IS NO OTHER VERIFIA BLE SOURCE OF INFORMATION THE ASSESSEE IS ABLE TO PROVIDE TO ARRI VE AT THE RESULTS OF HIS BUSINESS FOR THE YEAR EXCEPTING THE SALE BILL.THE CIT(A) OBSERVED THAT, WHEN THE ASSESSING OFFICER M AKES A VISIT TO HIS BUSINESS PREMISES, INVENTORIZES THE PH YSICAL STOCK AND QUESTIONS ABOUT THE EXCESS STOCK FOUND WITH SOU RCE OF BANK STATEMENTS AVAILABLE TO HIM, THE ASSESSEE STAT ES THAT SUCH BANK STATEMENTS ARE INFLATED STATEMENTS AND NE ED NOT BE TAKEN COGNIZANCE OF. IN A NUTSHELL, THE ASSESSEE CLAIMS T HAT THE FINANCIAL RESULTS DECLARED BY HIM SHOULD BE ACC EPTED SINCE HE HAS NOT MAINTAINED ANY VERIFIABLE SOURCE OF INFO RMATION RELATING TO HIS BUSINESS. 7. THE CIT(A) FURTHER HELD THAT THE STOCK STATEMENT S 5 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS FURNISHED BY BUSINESS PEOPLE NORMALLY CONTAINS INFL ATED RATES / ESTIMATED RATES TO GET MORE LIMITS OF OD FACILITY F ROM FINANCIAL INSTITUTIONS IS AN ACCEPTED PROPOSITION AND ACCORDI NGLY VARIOUS COURTS HAVE HELD THAT SUCH STATEMENTS CANNOT BE REL IED UPON TO ARRIVE AT THE CORRECT FINANCIAL RESULTS. IN THE CASE ON HAND, THE STOCK FOUND DURING THE COURSE OF SURVEY TALLIES WITH THE STOCK STATEMENTS FURNISHED TO THE BANK. 8. THE CIT(A) HELD THAT WHEN THERE IS A FINDING THA T THE STOCK INVENTORIZED AS ON THE DATE OF SURVEY IS TALL YING WITH THE STOCK STATEMENTS FURNISHED TO THE BANKS, THE ASSESS EE COMES UP WITH A CLAIM THAT THE STOCK INVENTORISED ON THE DATE OF SURVEY DOES NOT TOTALLY BELONG TO THEM BUT IT RELAT ES TO THIRD PARTIES AND THE SAME WAS GIVEN FOR REPAIRS. IN THE WRITTEN SUBMISSIONS FILED DURING APPEAL PROCEEDINGS, THE AS SESSEE HAS GIVEN FIGURES OF STOCKS GIVEN BY CUSTOMERS FOR REPA IRS. HOWEVER, THE CIT(A) DID NOT FIND ANY MERIT IN THE S UBMISSIONS OF THE ASSESSEE BY HOLDING THAT WHENEVER THERE IS A N ADVERSE FINDING, THE ASSESSEE IS TRYING TO EXPLAIN IT AWAY WITH HIS OWN INFORMATION WHICH CANNOT BE CROSS VERIFIED WITH ANY VERIFIABLE SOURCE. IF THE ASSESSING OFFICER POINTS TO THE AVAI LABLE SOURCE PREPARED BY THE ASSESSEE/PARTNERS OF THE ASSESSEE, EVEN THAT INFORMATION IS BEING DENIED BY THEM ON THE GROUND T HAT SUCH STOCK STATEMENTS CANNOT BE RELIED UPON. THE CIT(A) FINALLY CONCLUDED THAT IN THE ABSENCE OF ANY BOOKS OF ACCOUNT OR ANY OTHER SOURCE OF VERIFIABLE INFORMATION MAINTAINED B Y THE ASSESSEE, THE TREATMENT OF THE ASSESSING OFFICER IN REJECTING THE ADMITTED RESULTS AND GOING BY HIS FINDINGS ON THE DATE OF SU RVEY WITH THE AVAILABLE STOCK STATEMENTS IS VERY MUCH IN ORDER. A CCORDINGLY, THE CIT(A) UPHELD THE ADDITION MADE BY THE ASSESSING OF FICER TOWARDS UNEXPLAINED INVESTMENT IN STOCK OF RS. 45,02,866/-. 6 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS 9. AS REGARDS ADDITION OF RS. 3,24,708/-, THE CIT(A ) HELD THAT ESTIMATION OF PROFIT ON SUCH UNACCOUNTED SALES IS O NLY CONSEQUENTIAL AND THE RATE OF 8% ADOPTED BY THE ASS ESSING OFFICER IS REASONABLE. 10. AGGRIEVED, BY THE ORDER OF THE CIT(A), THE ASSE SSEE IS IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUN DS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE ORDER OF THE CIT(A) IS PERVERSE, ILLEGAL AND AG AINST THE PROVISIONS OF THE INCOME TAX AND FACTS ON RECORDS. 2. THE CIT(A) ERRED IN SUSTAINING THE ADDITIONS OF RS.45,02,866 AS UNEXPLAINED INVESTMENT IN RESPECT O F ALLEGED EXCESS STOCK OF GOLD WORKED OUT BY THE AO, AND ESTIMATED INCOME THEREON OF RS.3,24,708 @ 8%. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) IN THE LIGHT OF APPELLATE ORDER OF THIS HON' BLE TRIBUNAL OUGHT TO HAVE DELETED THE ADDITION TOWARDS THE EXCESS STOCK WORKED OUT. THE ACTION OF THE CIT(A) I N NOT FOLLOWING THE ORDER OF THIS HON'BLE TRIBUNAL IN SPI TE OF SPECIFICALLY BEING POINTED OUT IN REPLY TO REMAND R EPORT IS CONTEMPTUOUS AND BROW BEATING THE ORDERS OF THIS HO N'BLE TRIBUNAL. 4. THE CIT(A) OUGHT TO HAVE APPRECIATED THAT TH E FACTS IN SO FAR THE STATEMENTS GIVEN TO BANK FOR MAINTAIN ING THE CASH CREDITS LIMIT REMAIN SAME AND THEREFORE THERE IS NO SCOPE FOR ADDITION IN RESPECT OF ALLEGED EXCESS STO CK ONCE THIS HON'BLE TRIBUNAL HELD THAT NO ADDITION COULD B E MADE BASED ON THE STATEMENTS ISSUED TO BANK. 5. WITHOUT PREJUDICE TO ABOVE, THE CIT(A) ERRED IN HOLDING THAT THE ASSESSEE HAD NOT EXPLAINED THE INV ENTORY OF GOLD FOUND ON THE DATE OF SURVEY. THE CIT(A) FAI LED TO APPRECIATE THAT THE ASSESSEE HAD EXPLAINED THE STOC K INVENTORISED WITH EVIDENCE AND THEREFORE THERE WAS NO UNEXPLAINED STOCK AS ON THE DATE OF SURVEY FOR SUST AINING ANY ADDITION. 6. THE CIT(A) OUGHT TO HAVE APPRECIATED THAT TH E AO NEITHER GAVE AN OPPORTUNITY TO CROSS EXAMINE THE MA NAGER 7 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS OF THE BANK BASED ON WHICH THE ADDITION WAS MADE, A ND FURTHER THE AO NEITHER CONDUCTED ENQUIRES ON THE EV IDENCE FILED BY THE ASSESSEE EXPLAINING THE INVENTORY OF S TOCK FOUND ON THE DATE OF SURVEY. 11. AS CAN BE SEEN FROM THE GROUNDS RAISED THE ASSE SSEE HAS BASICALLY RAISED TWO ISSUES, FIRST ONE IS WITH REGA RD TO ADDITION MADE OF RS. 45,02,866/- AS UNEXPLAINED INVESTMENT I N RESPECT OF EXCESS STOCK OF GOLD AND THE SECOND ISSUE RELATES T O THE ESTIMATION OF INCOME ON THE SAID EXCESS STOCK OF GO LD @ 8%. 12. THE LEARNED AR REITERATING CONTENTIONS RAISED B EFORE THE CIT(A) SUBMITTED BEFORE US THAT THE SO CALLED DIFFE RENCE IN STOCK IS ACTUALLY NON-EXISTENT AS THE EXCESS STOCK FOUND IS ON ACCOUNT OF THE STOCK BELONGING TO THE THIRD PARTIES GIVEN FOR REPAIRS. IT WAS SUBMITTED THAT DURING THE ASSESSMENT PROCEEDINGS, T HE AO HAS HIMSELF CALLED FOR INFORMATION FROM VARIOUS CUSTOME RS IN A PRINTED FORM AND THOUGH THE CUSTOMERS HAVE SUPPLIED THE RE QUIRED INFORMATION, THE AO HAS COMPLETELY IGNORED THE SAME AND PROCEEDED TO WORK OUT THE ALLEGED EXCESS STOCK. IT WAS FURTHER CONTENDED THAT THOUGH THE ASSESSEE IN COURSE OF PRO CEEDINGS BEFORE THE CIT(A) HAS SPECIFICALLY BROUGHT THIS TO THE NOTICE OF THE CIT(A) AND THE CIT(A) HAS CALLED FOR A REMAND REPOR T BUT THE REMAND REPORT IS COMPLETELY SILENT ON THE INFORMATI ON OBTAINED FROM THE CUSTOMERS STATING THAT THEY HAD GIVEN GOLD ORNAMENTS FOR REPAIR. IT WAS SUBMITTED THAT THE CIT(A) ALSO I GNORED THE CONFIRMATIONS GIVEN BY THE CUSTOMERS EVEN THOUGH TH EY ARE VERY MUCH AVAILABLE ON RECORD. IT WAS CONTENDED BY THE L EARNED AR THAT IF PROPER ENQUIRY IS MADE WITH THE CUSTOMERS W HO HAVE CONFIRMED OF HAVING GIVEN GOLD ORNAMENTS FOR REPAIR PURPOSE, THEN, THERE WOULD BE NO EXCESS STOCK AS ALLEGED BY THE AO. THE LEARNED AR FURTHER CONTENDED THAT SINCE NO SPECIFIC QUESTION WAS PUT TO THE ASSESSEE WITH REGARD TO THE STOCK GIVEN BY CUSTOMERS 8 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS FOR REPAIR, THIS FACT COULD NOT BE EXPLAINED BY THE ASSESSEE. IN THIS CONTEXT, THE LEARNED AR REFERRED TO THE WRITTE N SUBMISSION FILED BEFORE THE CIT(A) AND THE LIST OF CUSTOMERS A LONG WITH THEIR NAMES, ADDRESSES AND OTHER DETAILS WITH REGARD TO G OLD ORNAMENTS GIVEN FOR REPAIR ALONG WITH CONFIRMATION LETTERS SU BMITTED IN THE PROFORMA STATED TO HAVE BEEN GIVEN BY THE AO AND TH E ORDER FORM OF THE ASSESSEE, WHICH ARE AT PAGES 5 TO 134 OF THE PAPER BOOK. 13. THE LEARNED DR, ON THE OTHER HAND, STRONGLY RE FUTING THE CONTENTION OF THE COUNSEL FOR THE ASSESSEE SUBMITTE D THAT THE SO CALLED CONFIRMATIONS ARE NOT AVAILABLE IN THE ASSES SMENT RECORD, HENCE, NO COGNIZANCE CAN BE TAKEN OF THEM. IT WAS S UBMITTED BY THE LEARNED DR THAT THE STOCK STATEMENT GIVEN TO TH E BANK AND STOCK AVAILABLE ON PHYSICAL INVENTORY HAVING TALLIE D THE SUPPRESSION OF EXCESS STOCK BY THE ASSESSEE IS ESTA BLISHED. IN THESE CIRCUMSTANCES, THE ADDITION MADE ON ACCOUNT O F EXCESS STOCK IS REASONABLE. 14. WE HAVE HEARD THE SUBMISSIONS OF THE PARTIES AN D PERUSED THE MATERIAL ON RECORD. ON PERUSAL OF THE ORDERS OF THE LOWER AUTHORITIES, IT CAN BE SEEN THAT AVAILABILITY OF EX CESS STOCK WAS CONCLUDED ON THE BASIS OF THE STOCK STATEMENT GIVEN TO THE BANK WHICH TALLIED WITH THE INVENTORY OF STOCK FOUND DUR ING THE COURSE OF SURVEY. HOWEVER, IT IS THE CONTENTION OF THE ASS ESSEE THAT ALLEGED EXCESS STOCK OF 4.136 KGS. OF GOLD CLAIMED TO BE EXCESS STOCK FOUND BELONG TO DIFFERENT CUSTOMERS WHO HAVE GIVEN THE STOCK FOR REPAIR. IN THIS CONNECTION, THE ASSESSEE HAS SUBMITTED A LIST OF CONTAINING DETAILS OF THE CUSTOMERS AND THE DETAILS OF GOLD ORNAMENTS GIVEN FOR REPAIR. THE ASSESSEE HAS ALSO S UBMITTED CONFIRMATION LETTERS OF CUSTOMERS STATED TO BE IN T HE PROFORMA PROVIDED BY THE AO ALONG WITH ORDER FORM, WHICH ARE AT PAGES 5 9 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS TO 134 OF THE PAPER BOOK. HOWEVER, ON PERUSAL OF TH E ASSESSMENT ORDER AND THE ORDER PASSED BY THE CIT(A), WE DO NOT FIND ANY MENTION ABOUT THE CONFIRMATION OF THE CUSTOMERS. TH E REMAND REPORT IS ALSO COMPLETELY SILENT ON THIS ASPECT. ON A QUERY MADE BY THE BENCH, THE LEARNED AR ASSERTED THAT THE AO I N FACT HAD MADE ENQUIRIES WITH THE CUSTOMERS AND IN RESPONSE T O THE QUERY MADE BY THE AO CONFIRMATIONS WERE SUBMITTED BY THE CUSTOMERS CONFIRMING THE GIVING OF GOLD ORNAMENTS FOR REPAIR. SUBSEQUENTLY, THE ASSESSEE HAS FILED A MEMO CONTENDING AS UNDER: THE APPELLANT HAS FILED THE APPEAL BEFORE THE HONB LE TRIBUNAL CHALLENGING THE ORDER OF THE LEARNED CIT(A )-V, HYDERABAD. THE APPELLANT IN THE PAPER BOOK HAS FILE D TABLE CONTAINING CUSTOMERS WHO HAVE GIVEN GOLD FOR REPAIR S AND MAKING ALONG WITH CONFIRMATION LETTERS FROM CUSTOME RS (PG. 5 TO PG.29). THESE ARE SUPPORTED BY COPIES OF ORDER FORM FOR MAKING/REPAIRS WHICH ARE ENCLOSED AT PAGES 30 TO PG . 134). THESE ARE PART OF ASSESSMENT PROCEEDINGS AND APPELL ATE PROCEEDINGS. HONBLE TRIBUNAL MAY KINDLY APPRECIATE THAT THE APP ELLANT APART FROM ADMITTING INCOME FROM TRADING ACTIVITY, HAS OFFERED INCOME UNDER REPAIR AND MAKING CHARGES AT R S. 6,15,000/-. THE INCOME SO OFFERED COUPLED WITH THE CONFIRMATION LETTERS FROM CUSTOMERS AND THE COPIES OF ORDER FORM ISSUED TO THE CUSTOMERS WHILE TAKING GOLD EITH ER FOR REPAIR OR MAKING WOULD PROVE THE STAND OF THE APPEL LANT THAT OUT OF TOTAL GOLD FOUND TO THE EXTENT OF 11.393 KGS ONLY 6.356 KGS BELONGED TO THE APPELLANT. THE AO HAS NOT DISCUSSED THIS ISSUE IN HIS ORDER AS MOST OF THE CUSTOMERS HAVE RESPONDED TO INQUIRIES CONDUCTED BY THE AO. FURTHER, EVEN IN THE APPEAL PROCEEDINGS WHEN A REMAND REPORT WAS CALLED FOR ON OUR SUBMISSIONS AND MATERI AL PLACED IN THE PAPER BOOK, THE AO DID NOT DISPUTE THE FACTU M OF THE MATERIAL BEING AVAILABLE ON RECORD. IT IS RESPECTFULLY SUBMITTED ALL THE EVIDENCE IN TH E FORM OF CONFIRMATION LETTERS AND THE COPIES OF ORDER FORM E NCLOSED FROM PAGES 5 TO 134 OF PAPER BOOK BEFORE THE HONBL E TRIBUNAL ARE PART OF ASSESSMENT AND APPEAL PROCEEDI NGS. THE SAME ARE NOT FRESH EVIDENCE BEFORE THE HONBLE TRIB UNAL. 10 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS 15. IT IS ALSO SEEN FROM THE LIST AT PAGES 5 OF THE PAPER BOOK THAT THE ASSESSEE HAS GIVEN DETAILS OF THE CUSTOMER S WHO HAD GIVEN GOLD ORNAMENTS FOR REPAIR. CONSIDERING THESE FACTS, WE ARE OF THE VIEW THAT NECESSARY ENQUIRY IS REQUIRED TO B E MADE WITH THE CONCERNED CUSTOMERS, THE DETAILS OF WHICH ARE A VAILABLE ON RECORD. ONLY AFTER MAKING A DETAILED ENQUIRY, THE A O CAN COME TO A CONCLUSION WITH REGARD TO THE ALLEGED EXCESS STOC K AND MAKE ANY ADDITION ON THAT ACCOUNT. SINCE NO ENQUIRY HAS BEEN MADE IN THIS REGARD, WE REMIT THE ISSUE BACK TO THE FILE OF THE AO WHO SHALL CONDUCT PROPER ENQUIRY WITH THE CUSTOMERS AND THEREAFTER DECIDE THE ISSUE ACCORDINGLY. THE AO SHALL AFFORD A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE M ATTER. 16. SINCE WE HAVE REMITTED THE ISSUE WITH REGARD TO THE ADDITION ON ACCOUNT OF UNEXPLAINED STOCK, THE OTHER ISSUE WI TH REGARD TO ESTIMATION OF PROFIT ON SUCH EXCESS STOCK HAS BECOM E REDUNDANT AND, THEREFORE, NOT REQUIRED TO BE ADJUDICATED UPON . 17. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 30/08/2013. SD/- SD/- (CHANDRA POOJARI) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 30 TH AUGUST, 2013. KV 11 ITA NO. 600/H/13 M/S SRI TARAKA JEWELLERS COPY TO:- 1) M/S SRI TARAKA JEWELLERS, S.NO.9, NEW PRAKASAM B AZAR, NALGONDA. 2) ITO, WARD 1, NALGONDA.. 3) CIT(A)-V, HYDERABAD 4) CIT VI, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T. , HYDERABAD.